That is your problem. KotOR 2 requires OpenGL 1.4 to function properly. You need to update your drivers. Unfortunately ATI does not support laptops so I know of no way to update them. 
  
Azuth 
  
Edit: Opps...sorry it requires version 1.4 not 1.5 to function properly.  
  
From the readme: 
  
 
  
From the Troubleshooting Guide: